Seaboard milling unit suffers loss in quarter

by Eric Schroeder
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SHAWNEE MISSION, KAS. — The Commodity Trading and Milling Division of Seaboard Corp. sustained a loss of $28,250,000 in the third quarter ended Oct. 2, which compared with operating income of $6,466,000 in the same period a year earlier. Excluding mark-to-market adjustments, operating income in the quarter was $9,400,000, which compared with $15,800,000 in the same period a year ago.

For the first nine months of fiscal 2010, operating income in the division totaled $13,907,000, down from $24,917,000. Excluding mark-to-market adjustments, operating income in the first nine months was $32,100,000, down narrowly from $32,500,000.

Division sales totaled $458,310,000 in the quarter, up 26% from $364,146,000. For the first nine months, sales rose 15% to $1,272,046,000 from $1,105,158,000.

“The increases are primarily the result of increased volumes of commodities sold to third parties, principally corn, soybean meal and wheat,” Seaboard said in a Nov. 5 filing with the Securities and Exchange Commission.

In the company’s Sugar segment, operating income totaled $3,669,000 in the third quarter, which compared with a loss of $659,000 in the same period of fiscal 2009. For the first nine months, operating income rose sharply to $24,491,000 from $498,000. Seaboard said the increases reflected higher margins from increases in sugar and alcohol prices.

Net sales for the Sugar segment in the third quarter rose 70% to $49,170,000 from $28,970,000, and for the first nine months rose 39% to $148,028,000 from $106,174,000.

Overall, Seaboard Corp. net income in the third quarter was $39,869,000, equal to $32.74 per share on the common stock, up 9% from $36,715,000, or $29.69 per share. Net sales for the quarter totaled $1,111,813,000, up 30% from $854,625,000 in the same period last year. For the first nine months net income was $180,251,000, or $146.93 per share, up from $79,607,000, or $64.32 per share. Net sales totaled $3,180,552,000, up 20% from $2,642,023,000.

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